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Supplementary Memo

To: Ms. Anne Lambert and the CMA Inquiry group

From: Media Matters for America

Date: 9 November 2017

Re: Proposed acquisition by 21st Century Fox of Sky PLC


Media Matters for America would like to bring the following developments and
considerations to the CMA Inquiry groups attention to supplement evidence highlighted
in our 24 October 2017 submission and the 27 October 2017 hearing for third party
informants. These further demonstrate that:

1. There is an identifiable link between 21st Century Foxs (21C Fox) poor
corporate governance and what is broadcast on the news outlets it owns,
especially Fox News;

2. The Murdochs and their news outlets continue to exploit the lack of regulatory
infrastructure regarding broadcast standards in the U.S. to meddle in politics;

3. The news/non-news distinction remains insufficient when assessing 21C

Foxs commitment to broadcasting objectives;

4. The closure of Sky News is not an appropriate counterfactual to the merger.

Further evidence of identifiable link between corporate governance

and broadcasting standards

Media Matters and other third party informants have highlighted notable examples of a
demonstrable link between 21C Foxs corporate governance and what is broadcast by
Fox News and other Murdoch-owned outlets. Here are other examples that we would
like to bring to the Inquiry groups attention, and that we believe call into question 21C
Foxs commitment to attaining broadcasting standards:

Fox News sexual harassment epidemic manifests itself on network programmes

As noted in previous submissions and the hearing, there is an identifiable link between
Fox News widespread sexual harassment epidemic and what is broadcast on the
networks programmes. The epidemic has undoubtedly been enabled by 21C Fox and
the Murdochs themselves. As previously noted, a 21 October 2017 New York Times
report revealed that then-Fox News host OReilly struck a $32 million agreement with a
15-year network analyst, Lis Wiehl, last January to settle new sexual harassment
allegations against him (the sixth known agreement made by OReilly or 21C Fox) and
that 21C Fox knew about the allegations.1 Furthermore, with this knowledge, 21C Fox
tried to keep the case private and made sure that OReillys contract was renewed.2

While the bidder boasts of having more female talent on the air than any other network
and continues to plead ignorance about the precise details of settlements and other
relevant cover-up attempts at the network -- James Murdoch claimed he didnt know the
OReilly settlement cost until after the Times reported it4 -- Fox News on-air and off-air
treatment of female employees and coverage of allegations brought against the network
explicitly demonstrate a larger culture of sexism. Here are a few snapshots:

Fox News engaged in a broadcast cover-up of the latest OReilly revelations. In

the nearly seven months between when the news first broke about OReillys
multiple multimillion-dollar settlements with several women over reports that he
sexually harassed them5 and October 24, Fox News devoted only 20 minutes and
46 seconds to covering the revelations. In contrast, the network devoted over 12
hours of coverage to reports detailing a pattern of sexual harassment by film
producer Harvey Weinstein in less than three weeks after they were initially
published.6 More than 16 of the 20-some minutes Fox News spent covering
Emily Steel and Michael S. Schmidt, OReilly Settled New Harassment Claim, Then Fox Renewed His
Contract, The New York Times, 21 October 2017,
Michael Calderone, Murdoch fetes Ingraham -- Newsrooms grapple with harassment claims -- Halperin
accused -- Brookings suspends Wieseltier -- Glor lands 'CBS Evening News' desk, Politico Media, 26
October 2017,
James Murdoch pleads ignorance, again. WIll his failure kill his fathers dream deal? Media Matters for
America, 26 October 2017,
Emily Steel and Michael S. Schmidt, Bill OReilly Thrives at Fox News, Even Has Harassment
Settlements Add Up, The New York Times, 1 April 2017,
Fox News spent 12 hours over 3 weeks on Harvey Weinstein but just 20 seconds over 7 months on Bill
OReilly, Media Matters for America, 25 October 2017,
O'Reilly's predatory behavior during that time appeared on Foxs media criticism
show, MediaBuzz.7

Women who have brought sexual harassment allegations against the network
were targets of demeaning rhetoric and harassment on air before they filed
complaints. A Media Matters review finds that Wiehl was subject to a steady
stream of sexually suggestive on-air commentary from OReilly while serving as
the co-host of his nationally syndicated radio show a decade ago.8 The New York
Times reported that during a 2001 segment on his radio show, OReilly
announced that Ms. Wiehl had landed a job at Fox News and said she owed him.
Former Fox News host Gretchen Carlson -- who last year brought sexual
harassment allegations against then-Fox News Chairman and CEO Roger Ailes,
lifting the veil on the networks epidemic -- noted in her complaint that the
harassment she experienced from male colleagues also happened on air,
including from her co-host Steve Doocy.10

Ousted predatory Fox hosts have also been welcomed back to Fox News
airwaves without disciplinary action from 21C Fox. As noted in Media Matters
submission to the CMA, despite being fired from the network in April 2017,
OReilly was allowed to return to Fox News airwaves in September for a softball
interview with Sean Hannity about OReillys new book.11 This wasnt just a
Hannity-coordinated affair. The day of the interview, Fox News aired at least one
promotion for Hannity's O'Reilly interview in each hour of programming.12 Since
his ouster from the network, OReilly has appeared on Hannitys radio show four
times and has used at least one of those appearances to attack the women who

The worst of Bill OReillys on-air denigration and harassment of Lis Wiehl, Media Matters for America,
23 October 2017,
Emily Steel and Michael S. Schmidt, OReilly Settled New Harassment Claim, Then Fox Renewed His
Contract, The New York Times, 21 October 2017,
Emily Crockett, Anchor Gretchen Carlson files lawsuit alleging pervasive sexual harassment at Fox
News, Vox, 6 July 2016,
By bringing back Bill OReilly, Sean Hannity proves hes a reckless loose cannon, Media Matters for
America, 25 September 2017,
annity, Media Matters for
Fox News goes all in promoting Bill OReillys return to the network on H
America, 26 September 2017,
brought allegations against him.13

Not only does Hannity continue to defend OReilly, but he is continuing his
collaboration with the former prime-time host, seemingly with Fox News consent
or tacit approval. Hannity planned to host OReilly on his radio show 1 November
2017 -- which would have been the fifth time OReilly would have appeared on
his show -- but the interview was canceled due to a supposed breaking news
story.14 OReilly indicated that his appearance would be rescheduled.15 There has
been no indication that the collaboration between Hannity and OReilly has
ceased or been scuttled. If Fox executives were serious about fixing the
networks toxic culture and dismantling the infrastructure that enables sexual
harassment16, they would have prevented Hannity from giving OReilly a platform
by now.

As noted in the 27 October hearing, Fox News has held female employees to
strict standards for how they should look on air, especially under Ailes
leadership. Female former Fox News employees have come forward in recent
years to share their experiences in meeting these standards. Carlson confirmed
that trousers were not allowed for co-hosts of Fox & Friends.17 Another former
Fox employee noted that for female employees, wearing your skirts short and
your heels high and wearing lots of makeup was the standard to follow.18 While
Rupert Murdoch, who continues to be Fox News acting CEO, has reportedly
lifted Ailes pantsuit ban,19 he promoted Suzanne Scott to president of
programming despite her role enforcing the clothing and makeup standards for
women and aiding the cover-up of sexual harassment allegations.20

After his $32 million sexual harassment settlement was revealed, OReilly heads back to Hannitys
radio show, Media Matters for America, 1 November 2017,
The infrastructure that enabled serial sexual harassment at Fox is still working, Media Matters for
America, 23 October 2017,
Former Fox Host Confirms That Network Doesnt Let Women Wear Pants On Air, M edia Matters for
America, 4 April 2017,
Amanda Terkel, Woman Who Worked At Fox News Says She Had To Wear Her Skirts Short And Her
Heels High, Huffington Post, 8 July 2016,
Gabriel Sherman, Women Can Wear Pants on Fox News Now, But Not Much Else Has Changed,
New York magazine, 14 May 2017,
Margaret Sullivan, If you think Fox News is changing, Rupert Murdochs internal memo shows it isnt.
At all, The Washington Post, 2 May 2017,
In line with off-air treatment of female employees and direct on-air targeting of women
whove brought allegations, sexism has run rampant on Fox News programmes for
years.21 The networks sexist behavior has ranged from remarks on womens physical
appearance to questions about female leaders intelligence and emotional stability to
trivialization of issues that disproportionately impact women, including pay equity.22

Racial discrimination at Fox News manifests itself on the network programmes

Just like Fox News sexual harassment epidemic has had direct broadcasting
implications, so has its racial discrimination problem -- and without disciplinary action
from 21C Fox. In the last year, over a dozen former Fox News employees brought
allegations of racial discrimination against the network, including former anchor Kelly
Wright. According to a lawsuit, senior-level network employees were alleged to
frequently ridicule Black employees by mocking stereotyped speech; force Black
employees to practice saying the words correctly in front of White employees; ask
employees, Why are all Black men women-beaters?; mock the Black Lives Matter
movement; and refuse to allow one of the few black anchors at the network to appear
on a prime-time show to discuss racial reconciliation in the U.S.23 Alongside Fox News
treatment of race on its airwaves, these instances of employee mistreatment illuminate
a direct link between poor corporate governance and broadcasting standards. Here are
a few snapshots:

Fox News hosts and executives have disproportionately marginalized the

contributions of African-American employees to broadcast programmes. For
example, Wrights suit against the network notes that OReilly refused to air
positive stories about the African-American community that Wright proposed
airing and that current network co-president Bill Shine demonstrated an
obsession with race when it comes to discussions with Mr. Wright, including
regularly asking him, 'how do Black people react to you' and 'how do you think
White viewers look at you?'24

White American superiority and grievance have been core narratives on Fox
News programmes for years, including OReillys former show. Fox News hosts,
contributors and their guests have pushed these narratives by regularly

Heres The Sexism Gretchen Carlson Experienced On Fox & Friends, Media Matters for America, 7
July 2016,
70 Awful Displays Of Sexism On Fox News, Media Matters for America, 18 August 2015,
Lloyd Grove, Inside Fox News Explosive Racism Lawsuit, The Daily Beast, 26 April 2017,
portraying African-Americans as thugs,25; demonizing the Black Lives Matter
movement26; casting immigrants of color as illegal27 and dangerous28 ; failing to
condemn neo-Nazism and white supremacist mobilization29; claiming
multiculturalism is a threat to national security30; hyping the myth of white
Americans being racially marginalized31; and downplaying the pervasiveness of
racial discrimination in the U.S.32

Fox News, other Murdoch-owned outlets continue to meddle in


Since the hearing, developments raised more questions about 21C Foxs commitment
to due impartiality and attaining broadcasting standards. Regarding Project Director Mr.
Joel Bamfords question during the 27 October hearing about the role of media in
influencing political and policy outcomes, recent weeks have demonstrated that Fox
News and other Murdoch-owned outlets are positioned to do more than just provide a
specific political slant to news discussions. Exploiting the relative lack of regulatory

Foxs Kevin Jackson: Mothers Of The Movement Raise Thugs Who Try To Kill Cops, Media Matters
for America, 28 July 2016,
OReilly: Is There Any Difference Between Black Lives Matter Protesters And Nazis, Media Matters
for America,
Fox News used illegal immigrant or its variations over 10 times more than other cable networks,
Media Matters for America, 13 September 2017,
How Fox News used violent gang MS-13 to demonize immigrants, Media Matters for America, 28 July
VIDEO: How Fox News is mainstreaming white supremacists and neo-Nazis, Media Matters for
America, 6 October 2017,
Nigel Farage: Theres a direct link between terrorism and number of people from different religions
and cultures allowed in a country, Media Matters for America, 17 August 2017,
Six Times Bill OReilly Defended The White Establishment Against The Left, Media Matters for
America, 21 December 2016,
Fox & Friends is sympathetic to neo-Nazis marching but outraged over sports players kneeling, Media
Matters for America, 22 August 2017,
infrastructure related to broadcasting in the U.S. especially, they are oriented and
encouraged to weaponise stories (however false or baseless) against leaders or groups
they disagree with until a political or policy outcome is achieved.

Just as they attempted to do with the now-retracted false story about Seth Rich, Fox
News aggressively leveraged another conspiracy-theory-laden story to distract attention
from the ongoing investigation into President Trumps ties with Russia. Over the course
of three weeks, network hosts and contributors led by Hannity hyped a report from The
Hill to claim that Hillary Clinton is really to blame for collusion with Russia because she
had approved the Russian nuclear energy agencys 2010 acquisition of Uranium One, a
company with licenses to extract U.S. uranium. What Hannity deemed an explosive
bombshell was in fact a widely debunked story that was the product of shoddy
reporting and fabrications.33

In a three-week period, Fox News spent nearly 12 hours discussing Uranium One,
according to a Media Matters analysis.34 President Trump himself seized on the story,
responding directly to the networks coverage.35 And Hannitys demand that Congress
do its job in addressing the supposed issue36 materialised within days when House
Republicans launched an investigation into the deal.37 Just weeks after the Uranium
One story was revived and other stories emerged that were baselessly cast as
indictments of Clintons supposed collusion with Russia, the Murdoch-owned Wall
Street Journal ran an editorial calling for the resignation of special counsel Robert
Mueller, who is overseeing the ongoing investigation into Trump-Russia collusion, and a
contributor op-ed urging a blanket presidential pardon to anyone involved.38
Republicans on Capitol Hill followed suit.39 Hannity, in particular, is now promoting a
conspiracy theory that reporters were paid to report on opposition research

How Steve Bannon and Sean Hannitys ginned-up Hillary Clinton uranium story became a
congressional investigation, Media Matters for America, 24 October 2017,
Study: Fox spent nearly 12 hours pushing the Uranium One pseudoscandal over the last three weeks,
Media Matters for America, 9 November 2017,
How Trump helps Fox & Friends set the media agenda, Media Matters for America, 19 October 2017,
FBI uncovered Russian bribery plot before uranium deal,, 17 October 2017,
Tierney Sneed, Nunes Announces Probe With Gowdy Into Obama-Era Russian Uranium Deal,
Talking Points Memo, 24 October 2017,
Jason Schwartz, Murdoch-owned outlets bash Mueller, seemingly in unison, Politico, 30 October
Kyle Cheney, Conservatives introduce measure demanding Muelers resignation, Politico, 3
November 2017,
commissioned by both Democrats and Republicans about President Trumps ties to

The posture and efforts of Fox News and other Murdoch-owned outlets to shape
political outcomes is unsurprising given Rupert Murdochs close advisory relationship
with President Trump and his hiring of political operatives, including Roger Ailes, to
oversee his news outlets.41 However, such behavior does not demonstrate a genuine
commitment to attaining due impartiality standards in the U.K. And as illustrated in the
case of the Seth Rich conspiracy theory, these outlets pursue the shameless
weaponisation of baseless stories to advance a political agenda at all costs -- from
undermining journalistic integrity to invading the privacy of the families of the deceased.
We would like to reiterate our recommendation that the CMA ask the bidder to provide
documentation regarding the status and efficacy of the internal investigation into the
Seth Rich matter (findings that have not yet been made public).

Other examples of Murdoch-owned outlets, especially Fox News, meddling in politics at

all costs can be found in our previous submissions and correspondence.

The news/non-news distinction remains insufficient when

assessing 21C Foxs commitment to broadcasting standards

While Fox News is no longer broadcast in the U.K., Ofcom recently reported that two
Fox News hosts, Hannity and Tucker Carlson, were found in breach of the Broadcasting
Code.42 Categorising their programmes as current affairs discussion and opinion and
commentary programmes, Ofcom ruled that both Hannity and Carlson were in violation
of due impartiality standards in individual segments about President Trumps Muslim
ban and the Manchester terror attack, respectively.43

While Ofcoms assessments illuminate the need to continue investigation into the
bidders commitment to attaining broadcasting standards, it is important to note that in
the past, the regulator has deemed other instances of Fox News hosts reporting and
commentary irrelevant for scrutiny under the Broadcasting Code, citing the supposed
categorical distinction between news and non-news content and programming.

Hannity promotes fringe conspiracy theory that reproters were paid to report on Trump-Russia
dossier, Media Matters for America, 8 November 2017,
Maggie Haberman and Glenn Thrush, Trump Reachs Beyond West Wing for Counsel, The New York
Times, 22 April 2017,
OFCOM BROADCAST AND ON DEMAND BULLETIN, Ofcom, Issue number 341, 6 November 2017,
For example, despite the alleged political motivations behind the Seth Rich story, Fox
News employees acceptance of the spin, and 21C Foxs deafening silence in the face
of its promotion, Ofcom expressed no concerns over the case because it allegedly did
not occur in a broadcasting standards context.44 The programs Fox & Friends and
Hannity, Ofcom wrote, do not constitute news programming and thus their coverage of
the Rich story did not warrant investigation under existing code.45 Both of these
programs and their hosts posit themselves as sources of news and their viewers see
them as such. Their promotion of a story as news and as a topic of discussion without
evidence absolutely warrants further review in the context of the broadcasting code -- as
does the process by which the story made the jump to the networks

As noted in our submission, while the structures of morning, daytime, and prime-time
programming vary, the line separating opinion and news programming at the network is
a convenient fiction that viewers are unaware of and showrunners ignore. This has been
a reality since the networks launch in 1994.46 Given Fox News claim to be a source of
news across all of its programming and Rupert Murdochs expressed desire for Sky
News to become more like Fox News,47 all of Fox News should be held to the standards
of due impartiality and due accuracy.

The 6 November 2017 Ofcom report also indicated that the regulator looked into but
ultimately declined to investigate three Fox & Friends segments on due accuracy, due
impartiality, and offensive material grounds.48 We recommend that the Inquiry group
seek information about the content of these segments and why they were not
investigated further. A catalogue of hundreds of other potential breaches from the last
year (and previous years) can be found on Media Matters website49 by Fox News show,
including Fox & Friends 50
, Tucker Carlson Tonight 51
, and Hannity.52

Ofcom letter to Secretary Karen Bradley and DCMS 25 August 2017,
Media Matters for Americas 24 October 2017 submission to the CMA,
Owen Gibson, Murdoch wants Sky News to be more like rightwing Fox, The Guardian, 24 November
OFCOM BROADCAST AND ON DEMAND BULLETIN, Ofcom, Issue number 341, 6 November 2017,
Media Matters for America,
Media Matters for America, Fox and Friends website reference tag,
Media Matters for America, Tucker Carlson Tonight website reference tag,
Media Matters for America, Hannity website reference tag,
Finally, reinforcing the fact that there is no line between news and commentary at the
network, Fox News recently hired Sebastian Gorka to serve in a news capacity. Gorka
has a demonstrated history of extremism and pushing misinformation. He has been
reported as a sworn member of a Nazi-allied Hungarian group53, has floated the
execution of Hillary Clinton54, and was previously fired by the Federal Bureau of
Investigation for over-the-top Islamophobic rhetoric.55 The Inquiry group should also
seek information from the bidder about how Fox News considered and approved this

The closure of Sky News is not an appropriate counterfactual to the


The CMA Inquiry group should be sceptical of Skys counterfactual to the merger as
detailed in its submission.56 In the absence of convincing evidence that Sky News
closure was being planned before 21C Foxs proposed acquisition, the closure should
not be accepted as an appropriate counterfactual to the merger. Per section 4.3.9 of the
CMAs Merger Assessment Guidelines, when considering any exiting firm argument,
evidence should be sought that has not been prepared in contemplation of the merger.
Furthermore, per section 4.3.10, to accept the exiting firm argument, the CMA would
need to believe that it was inevitable that the firm would exit the market and be
confident that there was no substantially less anti-competitive purchaser for the firm or
its assets.58

Sky's warning about shutting down Sky News is especially suspect in light of 21C Foxs
stated commitment to continue to broadcast news under the Sky brand in its
December 2016 proposal bid.59 It would be misguided in principle to accept what might

Report: Breitbart Editor-Turned-Trump Official Is A Sworn Member Of Nazi-Allied Hungarian Group,
Media Matters for America, 16 March 2017,
Sebastian Gorka says Hillary Clinton should be convicted of treason like the Rosenbergs: Those
people got the chair, Media Matters for America, 26 October 2017,
Spencer Ackerman, FBI Fired Sebastian Gorka for Anti-Muslim Diatribes, T he Daily Beast, 21 June
Skys Response To The CMAs Issues Statement, Sky, 24 October 2017,
Merger Assessment Guidelines, CC2 Revised, Competition Commission and the Office of Fair
Trading, September 2010,
PLURALITY, 21st Century Fox Inc., 24 October 2017,
be a threat designed to influence the CMAs decision. In a typical merger, the CMA
rightly approaches statements about closing down existing business with scepticism.
We ask the CMA to make a robust assessment here in light of what is set out in the
merger guidelines and 21C Foxs proposal.

For further consideration and exploration, even without Sky News, 21C Fox would still
have access to information about consumers by way of internet service. There is simply
no indication that the bidder 1) will not misuse that information for commercial or,
importantly, political purposes by way of analyzing behavior and patterns for retargeting;
and 2) can be trusted with that level of insight and information. Imagine if News Corp
was also the telephone service provider during the phone hacking scandal. The scale of
the damage would have been even worse. An approved merger could expose the
British public to the modern equivalent.